HC grants ZEEL injunction in dispute with shareholder
The company has cancelled its board meeting, scheduled for Wednesday, due to lack of quorum
MUMBAI: The Bombay high court on Tuesday granted an interim injunction against Zee Entertainment Enterprise Ltd’s (ZEEL) largest shareholder Invesco, restraining the latter from going ahead with the requisition of an extraordinary general meeting (EGM) seeking removal of the ZEEL managing director and chief executive officer Punit Goenka.
A single bench presided over by Justice Gautam Patel said, “I have granted an injunction to the respondents.” A detailed order of the court is awaited.
The high court had reserved its order on the issue last week after ZEEL had told the court that it was not willing to hold an EGM of shareholders as requested by its largest shareholder, Invesco.
The submission was made in response to a previous suggestion made by the Bombay HC whereby, Justice Patel had asked the ZEEL if it was willing to hold such a meeting.
Senior counsel Gopal Subramanium, who appeared for ZEEL, had told the HC at the time that the company’s Board of Directors could not grant permission for something that could turn out to be “illegal.” Invesco Developing Markets Fund and OFI Global China Fund, the largest investors of ZEEL, had sent a requisition to the company on September 11 to call for an EGM for the removal of MD and CEO Punit Goenka and two other non-independent and non-executive directors from the company’s board. It had also sought the induction of six new independent directors.
ZEEL, however, moved the HC on October 2, seeking that the court declares the requisition notice for a shareholders meeting sent by Invesco as illegal.
ZEEL has cancelled its board meeting, scheduled to be held on Wednesday for considering the results for the July-September quarter, due to lack of quorum.
In a regulatory filing, ZEEL on Tuesday said, “A meeting of the Board of Directors of the Company, which was scheduled to be held on Wednesday, October 27, 2021, inter alia, to consider and approve the unaudited financial results of the company both on a standalone and consolidated basis for the 2nd quarter and half year ended September 30, 2021, has been cancelled due to lack of quorum.” Two independent board members–Manish Chokhani and Ashok Kurien has resigned from the company last month after allegations of its largest investors Invesco Developing Markets Fund along with OFI Global China Fund LLC.
“The next date of the meeting will be duly informed with fresh notice,” the company said.
Invesco Developing Markets Fund along with OFI Global China Fund LLC—which together hold 17.88% ZEEL and had called an extraordinary general meeting of shareholders seeking to remove ZEEL’s MD Punit Goenka along with Kurien and Chokhani. Later both independent directors had resigned and ZEEL board had turned down the requisition of the shareholders to call for EGM.
After that the shareholders had moved before the Mumbai Bench of the NCLT and subsequently ZEEL has also approached the Bombay HC filing a suit against the requisition.